THE decision to abolish the WDA is "flawed" and "wrong", says a top business leader.

Created 30 years ago, the Welsh Development Agency (WDA), which spends around £1m of public money every day trying to make the economy stronger, is being merged into the Welsh Assembly.

The new Department of Enterprise, Innovation and Networks (DEIN) is to be run by politicians and civil servants.

CBI director general, Sir Digby Jones, said the Welsh Assembly had made a big mistake.

He said: "I think the decision to take the WDA inside is flawed. I think it's wrong. I think it's born of a desire for power and political control. I don't think it will serve Wales well and I think it's a real shame."

First Minister Rhodri Morgan announced the merging of the WDA, The Wales Tourist Board and Elwa into the Welsh Assembly in July 2004. The merger gives the Assembly direct control of the work of those agencies, and hopes the move will save £12m a year in running costs by 2009.

The move is treated with scepticism by businesses in North Wales.

The Patchwork Traditional Food Company in Ruthin has been getting business advice and support from the WDA since it was set up in 1983. Now employing 40 staff and exporting pates and luxury foods around the world, managing director Rufus Carter said: "They were doing a bloody good job.

"The optimist within me doesn't see any reason why things should have to

change whatsoever, but only time will tell."

Gareth Hall, currently chief executive, will head the new DEIN. He said: "We are not throwing the baby out with the bath water, far from it. There were a lot of good things about the WDA, the Wales Tourist Board, a lot of good things about the Civil Service.

"Those good things are being retained, and they are going to be built on, and the joining together will make this an even better organisation. I have got the commitment of all 1,500 people

going into this new organisation."

The politicians who lit the bonfire of the quangos, Mr Morgan, and Economic Development Minister Andrew Davies, said in a statement that with a week to go before the formation of the new department, it was more important to get on with the job than take part in yet another review of a decision taken 21 months ago.

. Sir Digby's can be heard on Week In Week Out on BBC One Wales tonight .